Loan Repayment

Upon graduation, withdrawal, or discontinuation of enrollment, the Office of Student Financial Aid will notify students of exit responsibilities. This will include repayment information on loans borrowed only while in attendance at the OUHSC. Debt incurred while attending other institutions, including the OU Norman campus, will not be included and is solely the student's responsibility to obtain repayment information.

Student loans are loans that must be repaid, except in cases of approved discharge or forgiveness. Loans must be repaid, regardless of whether a borrower obtained a degree, was satisfied with the institution he or she was attending, or finds employment in his or her desired field. Defaulted loans have serious and long term consequences.

For detailed information about each topic, please select from the following:

FEDERAL DIRECT SUBSIDIZED LOANS

Principal payments on Federal Direct Subsidized Stafford Loans are not expected of a borrower while enrolled at least half-time or during the 6 month grace period following graduation or when enrollment drops below half-time. Once the grace period expires, it cannot be regained. Interest accrual begins upon the expiration of the grace period and principal and interest payments begin. The standard repayment term on Subsidized Stafford loans is 10 years. There are no prepayment penalties if a borrower wishes to pay the balance off more quickly. There are also several options, dependent upon the borrower's situation, to extend the repayment term. If a borrower returns to school at least half-time and files for an in-school deferment, interest will not accrue until repayment begins again.

FEDERAL DIRECT UNSUBSIDIZED STAFFORD LOAN

Principal or interest payments on Federal Direct Unsubsidized Stafford Loans are not expected of a borrower while enrolled at least half-time or during the 6 month grace period following graduation or when enrollment drops below half-time. Once the grace period expires, it cannot be regained. Principal and interest payments begin upon the expiration of the grace period.

During in-school deferment periods, interest accrues on only the principal balance. However, once the grace period expires and repayment begins, interest will be capitalized. Capitalization means that interest will then be calculated on the principal and the previously accrued interest. While interest payments are not required while in school, payments made toward accrued interest will minimize long-term costs. The standard repayment term on Unsubsidized Stafford loans is 10 years. There are no prepayment penalties if a borrower wishes to pay the balance off more quickly. There are also several options, dependent upon the borrower's situation, to extend the repayment term.

FEDERAL DIRECT GRAD PLUS LOANS

Repayment of Federal Direct Grad Plus Loans begin 60 days after the final disbursement of the loan. However, a borrower of a Grad Plus loan can request that principal and interest payments be deferred while enrolled at least half-time and for an additional 6 months after the borrower is no longer enrolled half-time.

During in-school deferment periods, interest accrues on only the principal balance. However, when repayment begins, interest will be capitalized. Capitalization means that interest will then be calculated on the principal and the previously accrued interest. While interest payments are not required while in school, payments made toward accrued interest will minimize long-term costs. The standard repayment term on Grad Plus loans is 10 years. There are no prepayment penalties if a borrower wishes to pay the balance off more quickly. There are also several options, dependent upon the borrower's situation, to extend the repayment term.

FEDERAL DIRECT PARENT PLUS LOANS

Repayment of Federal Direct Parent Plus Loans begin 60 days after the final disbursement of the loan. However, a borrower of a Parent Plus loan can request that principal and interest payments be deferred while the student for whom the parent borrowed is enrolled at least half-time and for an additional 6 months after the student is no longer enrolled half-time.

During in-school deferment periods, interest accrues on only the principal balance. However, when repayment begins, interest will be capitalized. Capitalization means that interest will then be calculated on the principal and the previously accrued interest. While interest payments are not required while in school, payments made toward accrued interest will minimize long-term costs. The standard repayment term on Parent Plus loans is 10 years. There are no prepayment penalties if a borrower wishes to pay the balance off more quickly. There are also several options, dependent upon the borrower's situation, to extend the repayment term.

FEDERAL PERKINS LOANS

Principal payments on Federal Perkins Loans are not expected of a borrower while enrolled at least half-time or during the 9 month grace period following graduation or when enrollment drops below half-time. Once the grace period expires, it cannot be regained. Interest accrual begins upon the expiration of the grace period and principal and interest payments begin.

If a borrower returns to school at least half-time and files for an in-school deferment, interest will not continue to accrue until repayment begins again. Perkins loans borrowed while attending OU Norman and OUHSC are administered by the OU Norman Office of the Bursar and repayment issues are handled through their office. Once a borrower enters repayment, please contact their office at 405/325-5876 with questions. Payments are handled by a third-party servicer, ECSI. The standard repayment term on Federal Perkins loans is 10 years. There are no prepayment penalties if a borrower wishes to pay the balance off more quickly. There are also several options, dependent upon the borrower's situation, to extend the repayment term.

For deferment of Perkins loans, please contact the school from which you borrowed the loan(s). For loans borrowed while at OU Norman or OUHSC, please contact the OU Norman Office of the Bursar at 405/325-5876.

Perkins loan debt can be cancelled for borrowers in specific professions under certain circumstances. Please see the cancellation form for details.

HEALTH PROFESSIONS STUDENT LOANS

Health Professions loans are federal loans administered by the US Department of Health and Human Services Bureau of Health Professions and are available only to Pharmacy and Dental students. Principal payments on Health Professions Loans are not expected of a borrower while enrolled at least half-time or during the 12 month grace period following graduation or when enrollment drops below half-time. Once the grace period expires, it cannot be regained. Interest accrual begins upon the expiration of the grace period and principal and interest payments begin.

Interest and principal payments can be deferred during a period of internship or residency. The standard repayment term on Health Professions loans is 10 years. There are no prepayment penalties if a borrower wishes to pay the balance off more quickly. There are also several options, dependent upon the borrower's situation, to extend the repayment term.

Once a borrower enters repayment, the borrower will need to direct any loan repayment questions to the OUHSC Office of the Bursar, 405/271-2433. Payments are handled by a third-party servicer, ECSI. Health Professions Loans will not appear on a borrower’s NSLDS loan summary.

NURSING STUDENT LOANS

Nursing Student Loans are loans administered by the US Department of Health and Human Services Bureau of Health Professions and are available only to undergraduate Nursing students. Principal payments on Nursing Student Loans are not expected of a borrower while enrolled at least half-time or during the 9 month grace period following graduation or when enrollment drops below half-time. Once the grace period expires, it cannot be regained. Interest accrual begins upon the expiration of the grace period and principal and interest payments begin.

Interest and principal payments can be deferred during a period of at least half-time enrollment in a graduate nursing program. The standard repayment term on Nursing Student loans is 10 years. There are no prepayment penalties if a borrower wishes to pay the balance off more quickly. There are also several options, dependent upon the borrower's situation, to extend the repayment term.

Once a borrower enters repayment, the borrower will need to direct any loan repayment questions to the OUHSC Office of the Bursar, 405/271-2433. Payments are handled by a third-party servicer, ECSI. Nursing Student Loans will not appear on a borrower’s NSLDS loan summary.

LEW WENTZ LOANS

Lew Wentz Loans are loans made by the University of Oklahoma. Interest payments on Lew Wentz loans are required every July. Students earning a 4.0 GPA will have that semester’s interest waived. Principal payments on Lew Wentz loans are not expected of a borrower while enrolled at least half-time or during the 6 month grace period following graduation or when enrollment drops below half-time. Repayment begins in the 7th month following the expiration of the grace period. Once the grace period expires, it cannot be regained.

Lew Wentz loans borrowed while attending OU Norman and OUHSC are administered by the OU Norman Office of the Bursar and repayment issues are handled through their office. Once a borrower enters repayment, please contact their office at 405/325-5876 with questions. Payments are handled by a third-party servicer, ECSI. Because the Lew Wentz loan is not a federal loan, this loan information will not appear on a borrower’s NSLDS loan summary.

ALTERNATIVE/PRIVATE LOANS

Alternative loans are non-federally guaranteed, non-federally regulated loans. Private lenders define the repayment terms of each loan, which can equate to different terms for a borrower who has more than one private loan. Terms could change from loan to loan, and certainly from lender to lender.

Because the Alternative/Private loans are not federal loans, this loan information will not appear on a borrower’s NSLDS loan summary. There is no centralized database for a student to use to identify, if necessary, all of his or her private loan borrowing. It is imperative that the student maintains contact with his or her lender(s) while in school and during repayment. If a borrower is unsure of the loans he or she borrowed while in school, it is recommended that he or she contact the school's Office of Student Financial Aid for assistance.

RESIDENCY/RELOCATION LOANS

Residency and Relocation loans are private, credit based loans made to students enrolled in their final year of study in particular health professions fields. Lenders may provide assistance to students who incur specific costs related to interviews, exams, and/or relocating after graduation. Because these loans are non-federal loans, each lender determines the repayment criteria for each loan. These terms will vary by lender and are in no way guaranteed by the Office of Student Financial Aid.

Because Residency/Relocation Loans are not federal loans, this loan information will not appear on a borrower’s NSLDS loan summary. These loans are not processed through the Office of Student Financial Aid. Therefore, the Office will not be able to assist the borrower in any meaningful way with any questions or concerns the borrower may have.

REPAYMENT ESTIMATORS

Found at studentloans.gov, upon logging in with the borrower's PIN,
borrower-specific loan information will be retrieved from the National Student
Loan Data System, giving the user preliminary repayment plan eligibility
information and estimated repayment amounts. The user has the option of adding additional loan balances and will be able to view a number of repayment options, monthly payment amounts, interest paid, and many other helpful options to then discuss with the loan servicer(s).

Found at finaid.org, this calculator provides repayment estimates that are not specific to the borrower. Any combination of loan balance, interest rate, repayment term, and payment amount can be entered into the calculator. The results will show total interest paid and minimum salary estimates based on the monthly payment.

TRADITIONAL FEDERAL DIRECT LOAN CONSOLIDATION

Federal Direct Consolidation Loans allows a borrower to combine multiple federal loans into one loan, allowing for one monthly loan payment and one loan servicer with which to work for questions, repayment issues, deferment or forbearance requests, etc. Repayment terms can be lengthened from the standard 10 years to up to 30 years, depending on the total principal balance of the loan and the repayment plan approved. Consolidation can reduce the amount of the minimum monthly payment; however, a longer repayment term can also substantially increase the amount of interest paid over the life of the loan.

Subsidized and Unsubsidized Stafford loans (Direct and FFELP) Grad Plus (Direct and FFELP) loans, Parent Plus (Direct and FFELP) loans, Perkins loans, Health Professions loans, Nursing Student loans, and other federal loans in good standing are eligible for consolidation. Plus loans made to the parent of a dependent student cannot be transferred to the student, so only a parent borrower who is considering consolidation can consider the Parent Plus loan(s). Institutional loans, such as Lew Wentz Loans, and alternative/private loans cannot be consolidated.

Borrowers can consolidate loans after graduation or when enrollment drops below half-time. Once loans are consolidated, they cannot be removed from the consolidation.

It is important to give consideration to any borrower benefits, such as interest rate reductions, principal reductions, or loan cancellation benefits that belong to individual loans. Those benefits will be forfeited upon consolidation, as the consolidation loan is an entirely new loan, and those underlying loans are now considered paid in full.

Repayment of a consolidation loan begins immediately following the completion of the consolidation. Any grace period that had been remaining on loans that were consolidated is forfeited upon consolidation.

DEFERMENT AND FORBEARANCE

A number of deferment options are available to borrowers. Each deferment must be requested by the borrower and renewed upon the expiration of any existing deferment. In-school deferments are the only automatic deferments processed for borrowers currently not in repayment.

If a borrower is enrolled at least half-time, loan payments are automatically deferred through a reporting process the OUHSC utilizes. However, as a timing issue can arise for borrowers currently in repayment who are returning to school, it is strongly recommended that the borrower continue to make payments, as applicable, until the in-school deferment is confirmed with the loan servicer.

Economic Hardship Deferment, Military Service Deferment, and Post-Active Duty Student Deferment are deferment options in addition to the in-school option. During periods of deferment, interest on subsidized loans will not accrue and payments will not be expected.

Forbearance is a temporary postponement or reduction of payment when a borrower does not qualify for a deferment. Interest will accrue on all loans during periods of forbearance. Forbearances can be granted in intervals up to 12 months at a time for up to 3 years. Borrowers must continue to make payments until the forbearance has been granted.

DISCHARGE AND FORGIVENESS

Federal student loans may be discharged, or cancelled, but under very specific circumstances. Loans can only rarely be discharged in bankruptcy. Federal loans may be discharged if the borrower dies, becomes totally and permanently disabled, the school attended while borrowing closes before completing the program, or if the school engaged in fraudulent activity.

The loan discharge process can be lengthy and payments must continue to be made until the discharge is approved. It is possible to request a forbearance while in the discharge application process.

Qualified teachers in a low-income or subject-matter shortage area may qualify for deferment or cancellation.

After making 120 payments under specific repayment plans, some Direct Loan borrowers may qualify for Public Service Loan Forgiveness, a program that will forgive the remaining balance of a borrower's federal loan debt. Borrowers must be employed by a public service organization while making those 120 payments. Employment could include any federal, state, or local government organization or agency, tribal government entities, the military, public child and family services agencies, special governmental districts, and most charitable non-profit organizations.

STANDARD REPAYMENT PLAN

The Standard Repayment Plan dictates that a borrower will pay a fixed amount, at least $50, each month until the loan balance is paid in full in a 10 year period. Borrowers are automatically placed in the Standard Repayment Plan when entering repayment. It is the borrower's responsibility to contact the loan servicer(s) if a different repayment plan is needed or preferred.

Prepayment penalties will never be assessed to a borrower who wishes to pay more than the monthly minimum required. To calculate estimated loan payments, please visit the US Department of Education's repayment calculators.

EXTENDED REPAYMENT PLAN

If a borrower has more than $30,000 in total Direct Loans, or more than $30,000 in total FFEL loan, he or she can request to utilize the Extended Repayment Plan in which the repayment term is extended from the Standard Repayment term of 10 years to a period not longer than 25 years. This plan will reduce the minimum monthly payment, but will increase the amount of interest paid over the life of the loan(s).

Prepayment penalties will never be assessed to a borrower who wishes to pay more than the monthly minimum required. To calculate estimated loan payments, please visit the US Department of Education's repayment calculators.

PAY AS YOU EARN REPAYMENT PLAN

The Pay As Your Earn Repayment Plan limits maximum monthly payments to 10% of a borrower's discretionary income (the difference between Adjusted Gross Income and 150% of the poverty guideline for the appropriate family size.) Eligibility is limited to new borrowers on or after October 1, 2007 who also have a disbursed Direct Loan on or after October 1, 2011 and demonstrate a financial hardship. Repayment can be extended up to 20 years. This plan will reduce the minimum monthly payment, but will increase the amount of interest paid over the life of the loan(s).

Prepayment penalties will never be assessed to a borrower who wishes to pay more than the monthly minimum required. To calculate estimated loan payments, please visit the US Department of Education's repayment calculators.

GRADUATED REPAYMENT PLAN

With the Graduated Repayment Plan, monthly minimum payments start relatively small and increase every two years with the length of the repayment term being up to 10 years. The monthly payment will never be less than the accrued interest and no payment will ever be more than 3 times greater than any other payment.

Prepayment penalties will never be assessed to a borrower who wishes to pay more than the monthly minimum required. To calculate estimated loan payments, please visit the US Department of Education's repayment calculators.

INCOME CONTINGENT REPAYMENT PLAN

The Income Contingent Repayment Plan is for Direct Loans only and can provide flexibility in repayment because the monthly minimum payments are evaluated every year and will be calculated based on adjusted gross income (plus spouse's, if married), family size, and total Direct Loan debt. If the monthly minimum payment is not enough to cover the accrued interest, interest may be capitalized once each year, up to 10% of the original principal amount of the loan. The maximum repayment period is 25 years. If the loans have not been paid in 25 years, the unpaid balance will be discharged. However, that discharged loan amount may be taxable.

Prepayment penalties will never be assessed to a borrower who wishes to pay more than the monthly minimum required. To calculate estimated loan payments, please visit the US Department of Education's ICR repayment calculator.

INCOME SENSITIVE REPAYMENT PLAN

The Income Sensitive Repayment Plan is for FFELP Loans only and the minimum monthly payment is calculated based upon a fixed percentage of the gross monthly income. The maximum repayment term is limited to 10 years, potentially increasing the amount of the payments toward the end of the repayment term.

Prepayment penalties will never be assessed to a borrower who wishes to pay more than the monthly minimum required. To calculate estimated loan payments, please visit FinAid's repayment calculator.

INCOME BASED REPAYMENT PLAN

The Income Based Repayment Plan is intended to create an affordable monthly payment, according to a borrower's income and family size, for borrowers whose debt is high relative to income and family size. The maximum repayment term under IBR is 25 years. IBR allows a borrower to pay less in a monthly payment than under a 10 year repayment term. Also, if the monthly payment is less than the accrued interest, the federal government will paid the unpaid accrued interest for up to 3 consecutive years. Should a borrower's balance remain after 25 years, it is possible the remaining balance be forgiven. Borrowers who make 120 on-time payments and work in public service during that entire time may qualify for Public Service Loan Forgiveness.

Under IBR, annual documentation must be submitted to update income and family size. If documentation is not submitted, the repayment plan converts to a Standard Repayment Plan and the monthly payment would be based on a 10 year repayment term for the original principal balance. Because the repayment term is extended to up to 25 years, the total amount of accrued interest would be higher than if the loan had been paid in a shorter term.

Prepayment penalties will never be assessed to a borrower who wishes to pay more than the monthly minimum required. To calculate estimated loan payments, please visit the US Department of Education's IBR repayment calculator.